The subject of dealer v non-dealer servicing is a regular topic of radio and television advertisements with both sides of the argument regularly putting their respective cases. But with one side guaranteeing that non-dealer servicing won't affect new car warranties and the other suggesting that it may, it's not unreasonable to ask, who's right?

For vehicles covered by a new car warranty the answer is that the Trade Practices Act prevents the practice of 'exclusive dealing' by attaching conditions to the sale of goods that restrict the buyers freedom of choice to deal with whom or in what they choose.

Essentially this means that a vehicle manufacturer cannot specify that you must have your car serviced by a particular dealer or group of dealers as part of the warranty conditions.
This principle was upheld a few years ago when a major vehicle manufacturer was made to retract statements contained in a vehicle's handbook that suggested dealer servicing was required to ensure continuance of the vehicle's warranty.

Unfortunately though, that's a rather simplistic answer to a very complex subject. While the law says that you can't be compelled to have your car serviced by a dealer there are other factors that need to be considered.

Firstly, non-dealers can only do servicing, they can't do warranty work. That's the domain of an authorised dealer. Non-dealers will also generally not have access to complete service information, technical support, factory knowledge, special service tools and 'fixes' for any problems that may occur. In fact non-dealers may not even know about problems that they should be looking for. While such information often leaks out of the dealer network it usually takes some time, often years, before it becomes common knowledge in the industry.

Another more basic issue is that with technology the way it is, almost every manufacturer has its own dedicated electronic test equipment that is specific to its range of vehicles. Such tools are required to interrogate the cars computer, find intermittent faults and now more commonly to 'flash in' computer software upgrades to overcome specific issues. Such equipment is very expensive and available only to dealers.

But it's important to look past the purely technical issues and at the reasons people give for choosing to go outside of the dealer network. Price is often perceived as a factor in this decision, however the question of why non-dealer servicing could be cheaper needs to be considered.

Clearly dealers have big overheads and their hourly rates reflect this. However, when it comes to scheduled servicing, it's the vehicle's manufacturer, not the dealer that recommends the chargeable time. And with more people becoming aware of 'whole of life service costs' and factoring them into their purchase decisions, the time allocated for such servicing has been cut to the bone to ensure the vehicle's ownership costs remain as low as possible.

If non-dealer servicing is done 'by the book' as claimed, there should be little difference in the chargeable time. Therefore the only difference will be in the labour rate, which for most services won't be a huge amount.

The second potential area of saving is in the use of non-genuine service parts. While it's true that many OE (original equipment) parts are more expensive than non-genuine parts, this isn't always the case. The pressure of market forces influences the final cost of commonly used parts and it is in the OE manufacturer's best interests to keep prices competitive. So in many cases the difference in cost between genuine and non-genuine parts isn't that significant.

But even where non-genuine parts are available there are certain benefits in using OE parts even if a non-genuine part is available at lower cost. This is particularly important if the vehicle is still covered by a new car warranty, as the use of non-genuine parts could leave you stuck in the middle of an argument between a parts supplier and the vehicle manufacturer with neither party willing to accept responsibility if a failure occurs. In such an event its very much more difficult for a manufacturer to reject a claim if genuine parts have been used, unless of course poor workmanship can be proved.
But while your warranty is protected in law, the effects of non-dealer servicing on out-of-warranty or goodwill assistance is largely ignored. Few people realise that most (but not all) vehicle manufacturers operate a system of discretionary goodwill assistance that is over and above that provided under the terms of the warranty.

Among the many factors used to determine if goodwill assistance will be offered, and if so to what extent, is the vehicle's service history. In essence, if you don't support the dealer network it's unlikely that they will support you any further than is legally required.

It's probably fair to say, though, that with longer warranties becoming the norm, the level of good-will assistance is reducing and such claims are coming under greater scrutiny.
In the end it is your decision where to have your vehicle serviced. However, wherever that may be it is a reasonable expectation that any work done is performed by qualified people, according to the manufacturer's specifications and service intervals, and using genuine or appropriate quality parts where required.

Used vehicle servicing is a different matter altogether. Queensland's Statutory (used car) Warranty allows the selling dealer to nominate a specific repairer to carry out warranty repairs. You can still have normal servicing done anywhere you wish, although again there is a reasonable expectation that it will be done by qualified people in accordance with the manufacturer's requirements.
Failure to have the vehicle serviced, or inappropriate servicing, could greatly complicate future warranty claims or even compromise the remainder of the cover.

Aside from the Statutory Warranty, there is a range of used vehicle warranties on the market that offer varying degrees of cover as well as a variety of servicing requirements. Depending on the particular product, these warranties may have very specific requirements about who services the vehicle and when it gets serviced. In some cases servicing may even be required considerably more frequently than the vehicle manufacturer's service schedule specifies and you may have no say in who does the work and little control over how much is charged.

In this case this is allowable because the buyer has chosen to enter into a contract and has accepted the conditions of the contract. Problems that arise from these warranties generally relate to missed services, late services (even by only a few days or kilometres) and where the vehicle's owner is unable to return the vehicle to the designated repairer for whatever reason. In many cases warranties of this type have no flexibility and failure to comply with any of the requirements voids the cover.

This advice has been prepared as a guide only. Individuals should carry out their own investigations to satisfy specific requirements or situation.